Bill Text: CA AB1927 | 2009-2010 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Real property: common interest developments.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Vetoed) 2010-09-30 - Vetoed by Governor. [AB1927 Detail]

Download: California-2009-AB1927-Amended.html

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BILL NUMBER: AB 1927	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JUNE 9, 2010
	AMENDED IN SENATE  MAY 24, 2010
	AMENDED IN ASSEMBLY  APRIL 20, 2010
	AMENDED IN ASSEMBLY  MARCH 9, 2010

INTRODUCED BY   Assembly Member Knight

                        FEBRUARY 17, 2010

   An act to amend Section 1368 of, and to add Section 1360.2 to, the
Civil Code, relating to common interest developments.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1927, as amended, Knight. Real property: common interest
developments.
   The Davis-Stirling Common Interest Development Act provides for
the creation and regulation of common interest developments. Under
existing law, a common interest development is managed by an
association pursuant to the provisions of the governing documents of
the development.
   This bill would provide that any provision that is added to or
included in a governing document  initially  recorded on or
after January 1, 2011, that prohibits the rental or lease of a
separate interest is void, unless the provision imposing the
prohibition is approved by 2/3 of the owners of separate interests
with voting power, as provided.
   Existing law requires that an owner of a separate interest in a
common interest development provide certain items to a prospective
purchaser prior to transfer of title.
   This bill would also require the owner of a separate interest,
when a governing document prohibits the rental or leasing of all or
any of the separate interests, to provide a statement describing the
prohibition.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares that the rights of
common interest development owners to rent or lease their properties,
as the rights existed at the time they acquired them, should be
protected by the State of California. The Legislature further finds
and declares that a common interest development creates a unique home
ownership model that is unlike the status of a single family home in
a traditional neighborhood. Property owners and residents who
purchase units within, and live in, a common interest development
governed by a homeowner's association have agreed to live under rules
and guidelines created by a democratic process. It is best,
therefore, as provided herein, that the owners of units within a
common interest development determine, through the exercise of a
democratic decisionmaking process, what is best for their
communities.
  SEC. 2.  Section 1360.2 is added to the Civil Code, to read:
   1360.2.  (a) Unless approved as provided in this section, any
provision that prohibits the rental or lease of a separate interest
in a common interest development and that is added to a governing
document on or after January 1, 2011, or that is included in a
governing document  initially  recorded on or after January
1, 2011, is void.
   (b) On or after January 1, 2011, if a common interest development
adopts a governing document or an amendment to a governing document
that prohibits the rental or lease of a separate interest in a common
interest development, that provision shall be approved by a vote of
the owners of separate interests with voting power in the common
interest development.
   (c) The vote required by this section shall be conducted pursuant
to the requirements of Section 1363.03. Notwithstanding any
provisions of the governing documents to the contrary and unless the
association's governing documents in effect as of February 17, 2010,
require a different percentage, the provision that prohibits the
rental or lease of a separate interest in the common interest
development shall be approved by not less than two-thirds of the
voting power of the owners of separate interests in the common
interest development.
  SEC. 3.  Section 1368 of the Civil Code is amended to read:
   1368.  (a) The owner of a separate interest, other than an owner
subject to the requirements of Section 11018.6 of the Business and
Professions Code, shall, as soon as practicable before transfer of
title to the separate interest or execution of a real property sales
contract therefor, as defined in Section 2985, provide the following
to the prospective purchaser:
   (1) A copy of the governing documents of the common interest
development, including any operating rules, and including a copy of
the association's articles of incorporation, or, if not incorporated,
a statement in writing from an authorized representative of the
association that the association is not incorporated.
   (2) If there is a restriction in the governing documents limiting
the occupancy, residency, or use of a separate interest on the basis
of age in a manner different from that provided in Section 51.3, a
statement that the restriction is only enforceable to the extent
permitted by Section 51.3 and a statement specifying the applicable
provisions of Section 51.3.
   (3) A copy of the most recent documents distributed pursuant to
Section 1365.
   (4) A true statement in writing obtained from an authorized
representative of the association as to the amount of the association'
s current regular and special assessments and fees, any assessments
levied upon the owner's interest in the common interest development
that are unpaid on the date of the statement, and any monetary fines
or penalties levied upon the owner's interest and unpaid on the date
of the statement. The statement obtained from an authorized
representative shall also include true information on late charges,
interest, and costs of collection which, as of the date of the
statement, are or may be made a lien upon the owner's interest in a
common interest development pursuant to Section 1367 or 1367.1.
   (5) A copy or a summary of any notice previously sent to the owner
pursuant to subdivision (h) of Section 1363 that sets forth any
alleged violation of the governing documents that remains unresolved
at the time of the request. The notice shall not be deemed a waiver
of the association's right to enforce the governing documents against
the owner or the prospective purchaser of the separate interest with
respect to any violation. This paragraph shall not be construed to
require an association to inspect an owner's separate interest.
   (6) A copy of the preliminary list of defects provided to each
member of the association pursuant to Section 1375, unless the
association and the builder subsequently enter into a settlement
agreement or otherwise resolve the matter and the association
complies with Section 1375.1. Disclosure of the preliminary list of
defects pursuant to this paragraph does not waive any privilege
attached to the document. The preliminary list of defects shall also
include a statement that a final determination as to whether the list
of defects is accurate and complete has not been made.
   (7) A copy of the latest information provided for in Section
1375.1.
   (8) Any change in the association's current regular and special
assessments and fees which have been approved by the association's
board of directors, but have not become due and payable as of the
date disclosure is provided pursuant to this subdivision.
   (9) If there is a provision in the governing documents that
prohibits the rental or leasing of all or any of the separate
interests in the common interest development to a renter, lessee, or
tenant, a statement describing the prohibition.
   (b) Upon written request, an association shall, within 10 days of
the mailing or delivery of the request, provide the owner of a
separate interest with a copy of the requested items specified in
paragraphs (1) to (8), inclusive, of subdivision (a). The items
required to be made available pursuant to this section may be
maintained in electronic form and requesting parties shall have the
option of receiving them by electronic transmission or machine
readable storage media if the association maintains these items in
electronic form. The association may charge a reasonable fee for this
service based upon the association's actual cost to procure,
prepare, and reproduce the requested items.
   (c) (1) Subject to the provisions of paragraph (2), neither an
association nor a community service organization or similar entity
may impose or collect any assessment, penalty, or fee in connection
with a transfer of title or any other interest except for the
following:
   (A) An amount not to exceed the association's actual costs to
change its records.
   (B) An amount authorized by subdivision (b).
   (2) The amendments made to this subdivision by the act adding this
paragraph do not apply to a community service organization or
similar entity that is described in subparagraph (A) or (B):
   (A) The community service organization or similar entity satisfies
both of the following requirements:
   (i) The community service organization or similar entity was
established prior to February 20, 2003.
   (ii) The community service organization or similar entity exists
and operates, in whole or in part, to fund or perform environmental
mitigation or to restore or maintain wetlands or native habitat, as
required by the state or local government as an express written
condition of development.
   (B) The community service organization or similar entity satisfies
all of the following requirements:
   (i) The community service organization or similar entity is not an
organization or entity described in subparagraph (A).
   (ii) The community service organization or similar entity was
established and received a transfer fee prior to January 1, 2004.
   (iii) On and after January 1, 2006, the community service
organization or similar entity offers a purchaser the following
payment options for the fee or charge it collects at time of
transfer:
   (I) Paying the fee or charge at the time of transfer.
   (II) Paying the fee or charge pursuant to an installment payment
plan for a period of not less than seven years. If the purchaser
elects to pay the fee or charge in installment payments, the
community service organization or similar entity may also collect
additional amounts that do not exceed the actual costs for billing
and financing on the amount owed. If the purchaser sells the separate
interest before the end of the installment payment plan period, he
or she shall pay the remaining balance prior to transfer.
   (3) For the purposes of this subdivision, a "community service
organization or similar entity" means a nonprofit entity, other than
an association, that is organized to provide services to residents of
the common interest development or to the public in addition to the
residents, to the extent community common areas or facilities are
available to the public. A "community service organization or similar
entity" does not include an entity that has been organized solely to
raise moneys and contribute to other nonprofit organizations that
are qualified as tax exempt under Section 501(c)(3) of the Internal
Revenue Code and that provide housing or housing assistance.
   (d) Any person or entity who willfully violates this section is
liable to the purchaser of a separate interest that is subject to
this section for actual damages occasioned thereby and, in addition,
shall pay a civil penalty in an amount not to exceed five hundred
dollars ($500). In an action to enforce this liability, the
prevailing party shall be awarded reasonable attorneys' fees.
   (e) Nothing in this section affects the validity of title to real
property transferred in violation of this section.
   (f) In addition to the requirements of this section, an owner
transferring title to a separate interest shall comply with
applicable requirements of Sections 1133 and 1134.
   (g) For the purposes of this section, a person who acts as a
community association manager is an agent, as defined in Section
2297, of the association.